Tuesday, 25 October 2016
Last updated 10 hours ago
Jul 24 2014 | 10:32am ET
New European Union hedge-fund regulations have cost that continent’s investors access to Renaissance Technologies.
The quantitative hedge fund has closed its London office and stopped selling its two largest funds in Europe, Reuters reports. The EU’s new Alternative Investment Fund Managers Directive, which imposes strict new reporting and fundraising requirements on hedge funds foreign and domestic, came into effect on Tuesday.
RenTech’s London office dealt primarily with marketing its wares in Europe. It employed four people.
Retrenchment from Europe comes as RenTech finds itself under fire in the U.S. for its use of controversial basket options to skirt more than $6 billion in taxes. The firm’s co-CEO defend its use of the products on Tuesday during a Congressional hearing.
The turmoil has not stopped the Renaissance Institutional Equities and Institutional Futures funds—the two funds no longer available to Europeans—from posting positive returns this year. The funds are up 2.5% and 2.2%, respectively, through July 18, besting most hedge funds but lagging the broader markets. The two funds manage a combined $25 billion.